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Kane County divorce attorneyApart from acknowledging how much will be needed for rent and basic monthly expenses after a divorce, it is all too easy, and common, for divorcing couples to find themselves shelving the financial aspect of the split until after the process is finalized. When you consider the emotional toll of the end of a marriage and additional stressors such as parenting plan arrangements, a potential relocation, and maybe even a new partner for one or both parties, money is often one of the last things couples wish to think about. This can be especially harmful for those who have very limited funds to begin with, or for those who have little to no employment options when the marriage unravels. 

The Importance of a Financial Game Plan

No matter how much or how little money you have to work with, the lack of a financial game plan can result in a divorce that does not turn out in your favor. For example, if you and your spouse were already in serious debt prior to the separation, those debts may only get worse and become more unmanageable if they are ignored. As overwhelmed as you may already be, avoidance is never the answer where your financial well-being is concerned, especially when you are about to experience a significant shift in income and overall lifestyle due to the split.

Why It Pays Off to Address Financial Matters Early On

Whether you have had minimal time to prepare, are currently a stay-at-home parent and do not know where to turn for help, or are simply scared and are avoiding money matters because your mind is on overload, making a plan to address finances early on can help you turn the situation around. Here are three reasons why addressing your finances is important:

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5 Tips to Help You Prepare Your Finances Before Your Illinois DivorceIt has often been said that preparation is the key to success, and getting divorced is no exception. Most areas of your life will change after a divorce, including your living situation and parenting situation. Even though your divorce is an emotional process, it is just as much a legal and financial process.

Dealing with marital finances during a divorce can be tricky, especially since financial issues are often the root of disagreements during divorce negotiations. Proper preparation is crucial when it comes to the financial side of your divorce. Here are a few ways you can prepare your finances before you begin negotiations:

Tip #1: Collect Your Records

The first thing you need to do is to gather all of your financial information from the past couple of years. This can help you get a good idea of your financial picture and will ensure that you have everything ready as you begin the negotiation process. You should try to gather records such as:

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How Unemployment Will Affect Your Divorce ProcessLosing your job while in the middle of divorce will cause great upheaval in the process. Your regular income helps determine many parts of your divorce agreement, such as the division of property, child support, and spousal maintenance. It can be difficult to establish your income when you are still looking for a new job. Sudden unemployment should not halt your divorce process, but you will need to consider how losing your job changes what you need from your divorce.

Impact of Unemployment

While losing your job threatens your financial security, it can give you leverage to ask for more in your divorce agreement:

  • Because Illinois equitably divides marital properties during divorce, you can receive more than half of the marital properties to make up for lost income;
  • A lower income can lower your share of the child support obligation – at least until you get a new job; and
  • A lower income means you may receive more spousal maintenance or may eliminate maintenance if you would have been the payor.

All of these advantages are contingent upon you making a good faith effort to find a new job with a similar level of pay. If the court thinks you are abusing your unemployment status for personal gain, it may settle your divorce agreement using your previous income level. You need to document your efforts to find new employment.

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Divorcees Prefer Silence When Facing Financial ProblemsPeople who have filed for divorce are less likely to talk to others about their personal finances, according to a recent CNBC survey. Amongst the survey respondents who were divorced, 56 percent said that they rarely speak with family members about their money. Only 27 percent of all the survey respondents gave the same answer. There is nothing wrong with financial discretion when talking to family members. However, divorcees put themselves at risk if they do not talk to anyone about their financial troubles.

Reason for Silence

People dislike sharing their financial concerns with friends and family because they may be embarrassed about their situation. Unfortunately, divorce causes financial trouble for some people because:

  • They are primarily relying on their individual incomes to support themselves;
  • They lost some of their marital properties as part of the divorce;
  • They may have new expenses, including purchasing or renting their own homes; and
  • They may be required to pay child support and spousal maintenance.

It takes humility to admit that you need help despite worrying whether people will think less of you because you are struggling to pay bills and control your debt. Even if you are not in financial danger, you may be embarrassed to show that you cannot afford the same lifestyle as when you were married.

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Steps Needed for Financial Success After DivorceMuch of your work during your divorce will go towards ensuring that you are financially viable afterward. Through the division of property, you will lose assets that you may have been counting on for both your short-term stability and long-term investing. Holding onto key assets and establishing fair support payments is vital in reworking your financial plan. However, your divorce agreement is a starting point and not the end goal. You must follow through with wise decisions so as not to squander your hard work during the divorce.

Immediate Actions

When your divorce becomes officials, there are several changes you must make to acknowledge that you are no longer married:

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